Correlation Between Beyond Meat and Check Point
Can any of the company-specific risk be diversified away by investing in both Beyond Meat and Check Point at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Beyond Meat and Check Point into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Beyond Meat and Check Point Software, you can compare the effects of market volatilities on Beyond Meat and Check Point and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Beyond Meat with a short position of Check Point. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beyond Meat and Check Point.
Diversification Opportunities for Beyond Meat and Check Point
-0.93 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Beyond and Check is -0.93. Overlapping area represents the amount of risk that can be diversified away by holding Beyond Meat and Check Point Software in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Check Point Software and Beyond Meat is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Beyond Meat are associated (or correlated) with Check Point. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Check Point Software has no effect on the direction of Beyond Meat i.e., Beyond Meat and Check Point go up and down completely randomly.
Pair Corralation between Beyond Meat and Check Point
Assuming the 90 days trading horizon Beyond Meat is expected to generate 8.74 times less return on investment than Check Point. In addition to that, Beyond Meat is 3.01 times more volatile than Check Point Software. It trades about 0.01 of its total potential returns per unit of risk. Check Point Software is currently generating about 0.15 per unit of volatility. If you would invest 33,766 in Check Point Software on November 3, 2024 and sell it today you would earn a total of 29,726 from holding Check Point Software or generate 88.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 99.6% |
| Values | Daily Returns |
Beyond Meat vs. Check Point Software
Performance |
| Timeline |
| Beyond Meat |
| Check Point Software |
Beyond Meat and Check Point Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Beyond Meat and Check Point
The main advantage of trading using opposite Beyond Meat and Check Point positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Beyond Meat position performs unexpectedly, Check Point can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Check Point will offset losses from the drop in Check Point's long position.| Beyond Meat vs. DENTSPLY SIRONA | Beyond Meat vs. Charter Communications | Beyond Meat vs. Micron Technology | Beyond Meat vs. Unifique Telecomunicaes SA |
| Check Point vs. Zoom Video Communications | Check Point vs. MAHLE Metal Leve | Check Point vs. Hospital Mater Dei | Check Point vs. CM Hospitalar SA |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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